BETA2 was independently isolated and characterized by its ability to activate insulin reporter gene transcription in transfected Beta cells (termed BETA2), and neurite formation upon ectopic expression in Xenopus embryos (termed NeuroD1). This basic helix-loop-helix (bHLH) transcription factor will be referred to as BETA2. It is expressed in pancreatic islet endocrine cells, the intestine, the pituitary, and a subset of neurons in the central and peripheral nervous system. Interestingly, the number of insulin-expressing Beta cells was severely reduced in BETA2-/- mice, and the remaining endocrine cells failed to form islets. These animals develop early-onset diabetes and die perinatally. The nervous system appears to develop normally in BETA2-/- mice, presumably due to the presence of a compensatory factor(s). Collectively, these results suggested that BETA2 played an important regulatory role in transcription of the insulin gene in islet Beta cells, as well as for gene(s) required for pancreatic islet differentiation. Unfortunately, in contrast to the myogenic or adipogenic systems, the are not cell lines available to study islet cell differentiation. However, as progenitors cells of the endocrine pancreas express transcription factors that are essential for both neuroectodermal and islet endocrine differentiation, including ISL-1 and PAX6, we reasoned that the neurogenesis assay in Xenopus could provide insight into the mechanisms utilized by BETA2 during pancreatic development. As a consequence, we have been characterizing the sequences within BETA2 that are required for stimulating insulin gene transcription and neurogenic differentiation. Our results have demonstrated that evolutionarily conserved sequences spanning the bHLH (amino acids 100-155) and C-terminal (amino acids 156-355) regions are important for both of these processes. Deletional analysis of the C-terminal region indicate that regulated activation is mediated by two independent and separable domains of BETA2, which span amino acids 156-251 and 252-355. The p300/CBP co-activator was shown to interact with the 156-251 and 300-355 amino acid regions of BETA2. In addition, we have recently shown that BETA2:p300/CBP can activate expression of the gene-encoding the cyclin-dependent kinase inhibitor p21, suggesting that up-regulation of this key cell cycle regulator may be required for normal progression of the islet differentiation program. The experiments proposed below will test the hypothesis that BETA2-mediate activation involves the recruitment of p300/CBP, a factor that potentiates the activity of important regulators of cellular proliferation and differentiation.